Derivatives traders should be prepared to lose the initial margin they post at clearinghouses if it's needed to prevent a financial crisis, global markets regulators said.
The "margin is likely to constitute a very large pool of assets which would, if it can be used, provide a high degree of loss-absorbency" to help stabilize a central counterparty, or CCP, the International Organization of Securities Commissions and the Committee on Payment and Settlement Systems said in a joint report published yesterday.
The committee is part of the Bank for International Settlements.
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